understanding financial jargon
Inflation is measured by looking at a collection of common everyday items and services which the average family buys, and consumes. The basket of goods and services monitored is selected via sampled surveys and as such, over time, the constituent items in the basket will change. The total price of the overall basket of goods is monitored, and the increase from one month to the next, expressed as a percentage, represents inflation.
The two main inflation indices are the Consumer Price Index (CPI) and the Retail Price Index (RPI). Both share some common elements, but RPI includes housing costs and council tax whereas CPI does not.
The trend for inflation can be visualised by plotting the graph of inflation over time.
What to do if you need more help
If you need more help with your specific commercial loan, mortgage or insurance requirement please speak to a professional financial adviser.
We hope you found this information useful.
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